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As a sales person, you may hear the words product-led growth and whisper to yourself, "Where the heck do I fit in?" and you might even be scared your job is at risk.
It's actually quite the opposite. When armed with the right skills and data, selling through a product-led approach is going to make your job much easier, and feel more organic!
Think of product-led growth as a tool to help you do your job better. Product led growth is about understanding customer behavior and usage patterns so that you can target prospects who are genuinely interested in your product and have a true problem to solve. And obviously, sales is a big part of moving that needle. :)
So yes, a sales-led strategy still has its place! Companies that win find a balance between sales-driven and product-driven approaches and understand where they fit. As an Account Executive or Customer Success Manager, it is up to you to change your mindset and approach in order to close more deals or prevent customers from churning.
Spoiler alert: it's not just about getting more trials or convincing people to use your product - it’s also about helping customers solve their individual problems and expanding from there.
So don't fear PLG, embrace it!
What is product-led growth?
Let's start with the basics. For my advanced folks, feel free to skip ahead.
Product-led growth (PLG) puts products at the center of customer acquisition, retention and expansion. It involves putting data-driven product solutions in place to target customers, drive engagement, increase conversions, and ultimately grow revenue.
This approach is different from the traditional sales-led method which relies on human touchpoints to bring people into a product or service. The goal of PLG is to reduce friction for customers and focusing more on the customer journey rather than making the sale.
The key principles of product-led growth include building a product that is easy to use, has a clear value proposition, and solves a real problem for users. Then let the product speak for itself.
And it works! OpenView's report reveals that product-led companies grow 2.2X faster compared to those who don't. No wonder more and more companies are adopting product-led strategies.
Most people think of SaaS when thinking of PLG, which most of the time is true but we see even more industries start to take a PLG mindset. Take Tesla. Cars depreciate significantly the second you drive them off the lot, yet Tesla sells their cars online without a test drive. Tesla's trust in their cars is so high that they offer a 7-day money back guarantee.
Product-led growth is here to stay.
So, what does this mean for sales? Don't worry - sales isn't going away anytime soon!
What’s the difference between product-led sales and traditional sales methods?
Product-led sales and traditional sales methods differ in their approach to customer acquisition and retention.
The key difference between product-led sales and traditional sales methods is that the former focuses on the product and customer journey, while the latter focuses on the salesperson and persuasion techniques.
As a salesperson in product-led growth, you focus more on understanding customer behavior and usage patterns. By paying attention to how customers are engaging with your product, you can target potential customers who are more likely to become paying users.
Traditional sales methods rely heavily on human touchpoints, such as cold calling, emailing, and in-person meetings, to generate leads and close deals. In this approach, the salesperson is the driving force behind customer acquisition and retention.
The key is finding a balance between product-led sales and traditional sales methods. Product-led strategies help you identify people who are more likely to become loyal customers and generate continuous revenue, while traditional sales methods are great for generating short-term revenue.
Let's learn how sales can swim, not sink, in the new PLG world.
Traditional sales methods are becoming less effective
Customers are becoming more and more self-reliant. There's a ton of options, plenty of information online on how to solve issues, and most prefer to solve them without getting on the phone.
Do you want the bad news or good news first? (Always bad news first!)
Bad news, many people don't want to talk to you.
Good news, you don't want to talk to those people either!
If you aren't getting emails back or people are sending you to voicemail, most likely you have the wrong person, the wrong time, or nothing you're saying is adding any value to them.
People have caught on to the typical sales tricks. You can no longer spray and pray hoping that something sticks. You need to be creative in how to add value to the prospect's journey, versus being a distraction or turn off.
Why do sales reps fail in a product-led company?
What typically happens is a user starts a trial and is immediately bombarded with emails trying to upsell them, or worse yet, they don't hear from anyone at all because no one bothered to check usage data in the first place.
One of the first questions to a user from a rep is "how is your trial going?" You should know exactly how their trial is going, and what they are doing or missing to make their experience go from average to awesome!
The key to successful product-led growth is to use data, not just assume and send emails. Utilize the usage data you have to identify triggers that indicate someone needs to upgrade to a paid plan or enterprise level solution, and become that mentor who can guide them to the best solution for them, not for you.
The "selling" is going to feel way more organic and natural that way for both you and the prospect.
Here's some insights and tips into how you can shine in product-led sales:
Identify triggers to help add value in your outreach
Usage does not mean a user is a buyer. It's important to track, but not enough.
The best account executives and sales reps will take the time to find out who is actually paying for the product, not just relying on usage data. Instead of waiting for someone to sign up for a trial and reach out, they can tap into customer insights and identify the triggers that indicate an upsell.
Number of users, usage, velocity of growth, team size, etc. can all be indicators of an account ready to move up the paid plans. Look to your existing customer base to see what type of triggers you should be watching.
To ensure that customers have a positive experience with your product and ultimately become loyal advocates, it's crucial to find the right information for them and personalize your communication accordingly. Sending generic emails won't cut it.
Instead of sending out the same sales pitch in a sequence, make your outreach relevant to the user based on their persona. "I saw that you are using A,B, and C. That's awesome! Most of our customers also get a lot of value out of X,Y, and Z. Is that something that would help you out?"
Now you're not just "selling" to the user with another email that ends up in the trash, you're adding value which will be way better received.
Take the time to understand their product journey and send tailored messages with relevant content. Once you've identified their pain point, explain how the solution works and work WITH them to find the best choice and plan of action.
Understand the customer journey
Sales teams need to understand the customer journey and how the product fits into it. This will help them identify opportunities to engage with customers and provide value.
Sales reps should also understand how their product fits into the customer’s overall business strategy. Knowing their customers' goals, objectives, and challenges will make it much easier to provide tailored solutions that deliver value.
When sales teams know what their prospects are doing with the product and when they need help, they can focus on developing the right content and messages to support their customers.
The key is to focus on customer success, not just sales numbers. Product-led growth requires a different approach that takes into account the needs of the customer, instead of just pushing for a sale. Sales reps need to understand what users are trying to accomplish and how they can help.
Sales teams should work closely with product teams to provide feedback on customer needs and help shape the product roadmap.
Where should sales reps prioritize their time?
There's three stages you will want to advance each account: the individual, team and enterprise levels.
The key is to start small. For example, focus on individual user behavior first, then use product data to identify when it is time to move from individual user level up to team level then let sales educate customers about enterprise solutions.
Individual
At the individual level, monitor usage data to see if a customer is using all the features of your product - that could be an indication they need more than just the basic plan.
Most users that have an individual problem they need to solve, may be just fine with the basic or free plan. They're not your buyer. That 10 email sequence you put them in might even be a distraction which can hinder any meaningful engagement later on. People become blind if it's too early.
These types of users prefer not to speak with a sales representative, they want to be self-serve. Awesome, let them! They typically have a low budget. You can provide guidance to them and make their experience smoother until they show signs that they are ready to upgrade.
Product and marketing teams should continue teaching them about the features available to teams and enterprises when they are ready.
Team
At the team level, you want to identify users who are collaborating within the workflow or engaging with multiple members on their team - that can indicate it's time for them to upgrade to a higher-level plan.
Start by utilizing customer usage data as triggers for personalized outreach. If your product has a free trial, use this time to understand user behavior and identify which users could benefit from an upgrade or additional features.
Once you have identified these potential buyers, you can build a personalized message based on their team needs and drive conversions.
You should have a clear understanding of everyone in that account and what they are looking to solve both on an individual and team level. Ask deeper questions here and educate them on how other teams have been successful and what they can do to get even better outcomes.
Enterprise
At the enterprise level, your goal is to introduce those team members and their decision makers to the value of investing in an enterprise solution. Sales reps need to have the right conversations with these stakeholders to ensure they understand how it will benefit them in the long run.
Typically any effort in this stage should only occur with deals over a certain amount, like $10K+.
It is extremely hard for an individual or team to understand the value of the enterprise level with only product-led growth. You need sales to make the case and educate the accounts on the broader value proposition of their products beyond just their features.
Look out for customers who have rapid growth or multiple teams or departments in place - this means they may need an even larger solution than what is currently being offered.
There are some behavior signals that may indicate the team is looking to move to the enterprise level solution. One may be someone reviewing the privacy and terms of service landing pages. An individual user probably won't take the time to dive into this, so if you see this happen it might be a great opportunity to jump in on a meeting with them. Look out for other behavioral triggers you see from your existing enterprise customers. When were they ready to make the leap?
Sales reps need to think beyond individual purchases and focus on building trust within an organization by delivering real results with their product or service.
Your goal is to build relationships and provide value to these accounts to move them up the stages without any friction. Engage prospects when an upsell makes sense and they will get added value to their team or company.
Multiple people make enterprise decisions
Most sales reps make the mistake of going directly to the decision maker (or the person they assume is the decision maker) and forget about everyone else.
But the reality is there are many people who weigh in when a company is making a decision. Your job is to make sure each of those people are having an amazing experience and seeing value.
You could spend multiple meetings having the best conversations with the VP, and they may even be sold that your product is the best choice. But if the team is telling the VP, "We want to use this X competitor!", guess who they'll probably go with?
Individual contributors who are in the product every single day can also be the best way to get information on how to solve the company's overall problems. Dig deeper! You also could impress the buyer with how well you know their team and company.
In conclusion
Remember, don't be a distraction. Product-led growth should be used as a tool to add value to the customer experience by highlighting the best solutions for their problem. This can lead to better conversions and more satisfied customers in the long run-- who will then in turn become loyal advocates for your product or service.
By combining product-led growth with sales reps engaging in meaningful conversations, you can create a win-win situation for everyone.
Product-led growth is not about taking away jobs from sales reps ––it’s about helping them do their job better!
